Please bear with me.....but now Im confused.....if its on the PSP how do I edit it....is it accessible from the PSP directly or do I need to edit it through my PC. When I connect by the USB connection all I can see on explorer are the folders on the memory stick. What am I missing?

You have to edit it through your PC. Access your PSP's flash0, and it'll be under the etc folder, open it up and change 5.00 to 5.02. It doesn't spoof your firmware, but it makes programs that require a higher firmware run on your PSP.